Hepatitis C virus (HCV) infection in humans is almost invariably associated with viral persistence, which leads to the development of liver cirrhosis and hepatocellular carcinoma. In chronic HCV patients, cellular immune responses including the production of IFN-g are severely impaired. In addition, HCV-induced immune suppression is associated with increased susceptibility to bacteria and other enteric viral infections. Thus, HCV most likely evolved a strategy to avoid host immune surveillance by encoding gene products, which are capable of dampening host immune responses. The goal is to understand host-virus interaction during the acute phase of HCV infection. To understand the mechanism(s) of immune evasion by HCV and to design strategies for therapeutics and improved immunization, we identified the HCV core protein as an immunomodulatory molecule to inhibit T cell function. In addition, we successfully demonstrated a novel interaction between HCV core and complement receptor (gC1qR) leading to inhibition of T cell function. C1q is a ligand for gC1qR and plays a critical role in innate immunity, as well as, regulation of adaptive immunity. HCV core-treated CD4+ T cells are able to suppress CD8+ T cells. Intriguingly, the binding of extracellular core protein to gC1qR on T cells induced SHP-1 recruitment and SOCS1 mRNA expression. Based on these findings, we hypothesize that HCV core-induced suppression of T cell function may play a role in the establishment of persistent infection. In this proposal, we will first examine the ability of HCV core-treated CD4+ T cells to suppress HCV-specific CD8+ T cells. Second, we will characterize the role of SHP-1 and SOCS1 in the T cell inhibitory function of core-treated CD4+ T cells. Third, we will determine the gC1qR expression level and core-induced CD4+ T cell dysregulation. The studies proposed here will help to elucidate the mechanisms of HCV core-induced immunosuppression. In addition, they will provide a basis for the rational design of novel therapeutic agents to block the action of HCV-induced immunosuppression.